SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.

ADMINISTRATIVE PROCEEDING
File No. 3-11283

In the Matter of Shane Ferras

The Securities and Exchange Commission ("Commission") announced today that it issued an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 ("Order") against Shane Ferras ("Ferras"), a former registered representative of HGI, Inc. ("HGI") and a resident of Brantford, Ontario, Canada. In the Order, the Division of Enforcement alleges that the United States District Court for the Southern District of New York has issued a permanent injunction against Ferras and found him liable for defrauding investors by using fraudulent boiler-room sales practices and training other HGI registered representatives to use these fraudulent sales practices, including inducing his clients to purchase highly speculative securities in initial public offerings underwritten by HGI, executing unauthorized transactions in his customers' accounts, and failing to execute sell orders placed by his customers.

The Commission instituted this administrative proceeding after the District Court entered a Judgment by Default against Ferras: (1) permanently enjoining him from future violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder; (2) ordering Ferras to disgorge $2,346,474, consisting of $1,525,127 in ill-gotten gains plus prejudgment interest of $821,347; and (3) imposing a civil penalty of $10,000. [Securities and Exchange Commission v. HGI, Inc., et al., 99 Civ. 3866 (DLC) (S.D.N.Y.)].

A hearing will be scheduled before an administrative law judge to determine whether the allegations contained in the Order are true, to provide Ferras an opportunity to dispute these allegations, and to determine what, if any, remedial sanctions against Ferras are appropriate and in the public interest pursuant to Section 15(b) of the Securities Exchange Act of 1934.

The Commission directed that an Administrative Law Judge shall issue an initial decision in this matter within 210 days from the date of service of the Order.